Analysts have been upbeat about the world economy for the year 2018 saying there are likely going to be a strengthening across the globe even though more effort is still needed. The authoritative Organisation for Economic Cooperation and Development (OECD) that publishes economic reports, statistical databases, analyses and forecasts on the outlook for economic growth worldwide indicating various global, regional or national orientations confirmed the trend last week.
Thus, the annual growth of the world economy is projected to slightly improve from 3.6 per cent this year to 3.7 per cent in 2018. However, the tendency appears short-lived as the forecast for 2019 presents the figure again dropped to 3.6 per cent. While the statistics give hope that the crisis witnessed about a decade ago may not be a fatality, the worry continue to evolve around ways to ensure inclusive growth and resilience in the economies of most regions. The report which looks at private sector performance, investment and productivity discloses higher employment levels compared to the crisis period, but also talks of long-term challenges that could hamper steady growth.
Such a drop in momentum has also been explained by the fact that although the employment figures for next year look promising, they have not been accompanied by real wage gains. As such, inclusive growth is still a major concern that has to be tackled at a macro-level. “Growth has picked up momentum and the short-term outlook is positive, but there are still clear weaknesses and vulnerabilities,” said OECD Secretary-General Angel Gurria after the report of 28 November, 2017 made public by the institution. The report added that; “There is a need to focus structural and fiscal action on boosting long-term potential as monetary policy support is reduced.”
Apart from various predictions that the African Continent can be sanguine about growth due to its youthful population, the recent declaration during the State of the Union address by the President of the European Commission at the European Parliament Plenary Chamber in Strasbourg on 13 September, 2017 raised much hope for the EU. President Jean-Claude Juncker felt comfortable presenting a favourable global picture of economic growth in the entire EU bloc while hoping that those gains will be consolidated.
With China already positioned as top in economic growth worldwide, some individual statistics show that in the United States, growth is estimated at 2.2 percent in 2017, rising to 2.5 percent in 2018, and then dropping back to 2.1 percent in 2019, Germany is forecast to grow by 2.5 percent in 2017, 2.3 percent in 2018, and 1.9 percent in 2019. France is projected to grow by 1.8 percent over the 2017-18 period and 1.7 percent in 2019 and so on. Issues related to the Brexit negotiations between the EU and the United Kingdom are also said to account for the UK’s growth slowdown.
While the major emerging markets continue to benefit from positive economic ratings, many households, be they in developed or developing countries will only best understand positive prospects in their lives if their debt burden drops through more offers for employment and the ability to meet daily needs. Questions of economic vulnerability and sustainable growth will only make sense to analysts at a macro-level with corporate and state institutions grappling with realities that permit survival in a competitive world. Yet, meeting daily needs are issues of utmost importance to all, given that crisis situation such as the economic breakdown in 2008 or even the drop in oil prices does have a direct impact on ordinary citizens.